Since the breakthrough of the US and China getting on board with sustainability commitments, it would be difficult for businesses to ignore their own environmental impact or to not consider the sustainability of their practices going forward.
A recent UN Global Compact report noted that 84% of the 1,000 global CEOs surveyed agreed that businesses “should lead efforts to define and deliver new goals on global priority issues”, with only one third saying that their “business is doing enough to address global sustainability challenges”.
Due to global concerns about climate change, sustainable supply chain practices should be a way of life for all businesses, in order to manage resources now and into the future.
Here are four easy, yet important ways to create a sustainable supply chain for your business.
- Managing Waste
- Increasing Distribution Efficiency
- Improving Your Supply Chain
- Considering Your Paper Footprint
Having an effective waste management plan in place includes cutting down on unnecessary collateral and redundant stock, as well as introducing more efficient practices. Since 50% of company waste comes from paper alone, it’s often the place to start. The waste management industry is set to grow to $560 billion dollars (£400 billion) by 2020, powered by smart waste technologies.
Introducing sustainable methods means understanding what you need, both in terms of the quality and the volume of materials. By working closely with your suppliers and outlining your specifications, you should be able to ensure that products arrive to you right, the first time round. Wasted orders due to poor quality or faultiness equal wasted time, money, and resources.
If you are in the initial stages of sourcing suppliers, it’s important to remember that a low cost doesn’t always equal a high-quality supplier. You’ll need to balance quality and cost in order to find the best suppliers that can deliver the best products for your business. Opting for a less expensive supplier may run the risk of receiving quantities of low quality stock, which end up wasted, ultimately tarnishing your business’s environmental goals.
However, with the rise of technology and the constant evolution of smart programmes, your business can benefit enormously. In fact, over 70% of CPOs plan to invest in further technology in the upcoming year, but only 40% of companies have a clear digital strategy. Digital procurement, electronic data interfaces, and electronic payment can all help your business significantly cut down on paper waste (not to mention wasted time) with regards to invoices.
When it comes to managing wasted stock, intelligent stock analysis software can monitor existing stock accurately and offer solutions. Some software allows you to anticipate what stock you need, becoming more accurate the more times you order. The algorithm will check the amount you ordered last time versus the amount you used, and the technology can anticipate your future demand. This provides more accurate information in regards to stock and removes the level of guesswork, so you can reduce the volume of redundant, unnecessary stock your business is ordering.
Distribution efficiency comes down to understanding how far your materials have to travel and how many truckloads are being used to transport these materials. There are numerous ways to overcome distribution efficiency problems.
It can be tempting to send out your stock in a half-full truckload if your order is smaller than usual, but such practices can soon have an impact on your sustainability over time. Your suppliers may handle delivery needs for you, but it’s important to ask your suppliers about their sustainability practices.
Another way to quickly cut down on distribution distance and reduce your business’s carbon footprint is to source materials closer to your manufacturing location. You will need to balance distance with cost when it comes to sourcing your suppliers – you may find a supplier who can offer a more competitive cost, but who is much further afield, increasing the miles (and length of time) your stock has to travel.
By making positive changes such as these to the structure of your distribution, your business can help significantly improve the efficiency and sustainability of its distribution.
In improving your business’s sustainability, you also want to ensure that your suppliers meet your sustainability goals. In fact, data from a recent survey by Green Research found that 81% of businesses consider asking a supplier about their sustainability practices to be of necessary importance; this is a question that should always be factored into supplier contract negotiations.
All of the suppliers you work with should have their own practices in place where they manage their own waste – and manage the sustainability of their own supply chains. To ensure sustainability and quality, check that your supplier is ISO14001 (International Organization for Standardization) accredited; this accreditation is a signal that a supplier holds an environmental commitment and follows the most sustainable practices.
If your business does not yet hold this accreditation, it is an important certification to move towards; having this policy and commitment in place can increase trust in your business from consumers and fellow businesses alike.
Ensuring sustainability is cyclical, but can have an extreme impact on your own business costs, as well as environmental impact. Sustainable practice is the only way to guarantee your business will succeed long into the future.
Paper makes up an incredible 35% of all landfill waste, even though it’s one of the easiest products to recycle and reuse. The average UK office worker uses 45 pieces of paper per day, two thirds of which is considered waste. With all of this in mind, it’s easy to understand how these figures can soon start to add up and hinder the sustainability goals of your business.
Furthermore, as many as 52% of businesses have no idea how much they are spending on printing, routinely overspending on their budgets by £10,000 per year. By reining in printing expenditure, businesses can see an annual savings of at least 50%. If this wasn’t good enough, by outsourcing to a print management company, your business could save even more.
Reevaluating your business’s printing habits can help when trying to cut down on your paper footprint. From invoices and memos to printing emails and spreadsheets, it’s important to carefully consider what you actually need to be printing. A simple solution is to go digital. But, this is not always a quick-fix answer.
If you're a company that does have printing needs, then it's time to identify the volume of printed material your business requires, in order to better lower the volume of wasted print.
Since print services is one of the easiest ways to make your businesses more sustainable each year – with measurable impact – it should be one of the practices that is considered carefully within your overall environmental strategy.
Whether in your own company or with your suppliers, it’s important to ensure that your business practices are sustainable for the long term. Being sustainable is no longer a case of being cutting edge; sustainability is now a given, so if you haven’t considered sustainability in your business and your supply chain, you may be vastly behind your competitors.
How can you cut costs, whilst utilising the best suppliers at the procurement stage? Find out by downloading our guide, The Four Stages of Procurement Savings.